Honduras Canceling Mining Concession

The Honduran government has decided to ban a Canadian gold mine. But the mining industry is up in arms - and the Mineweb website is stoking the fires.

Honduras Canceling Mining Concession

6th July 2004

Yahoo News Service

TEGUCIGALPA, Honduras - The government is canceling the mining concession of a Canadian company over allegations that it was exploiting a nature reserve, Attorney General Sergio Zavala said Tuesday.

The action affects the 945-acre El Ocote concession in western Honduras operated by Maverick SA, a subsidiary of Vancouver-based SilverCrest Mines Inc.

"The Maverick contract now has been annulled because it was exploiting El Guisayote, which is a biological reserve," he told a news conference.

He said that Maverick "did not comply with the contract because it exploited a zone that did not figure into the concession that had been granted."

A SilverCrest director, Barney Magnusson, disputed that allegation in a telephone interview from Vancouver. "There has been no activity conducted anywhere near that area," Magnusson said.

"We had it surveyed. It was bona fide when we filed it (the request for the concession). It was in compliance with all Honduran laws at the time," he said.

Magnusson said the company's Vancouver offices had not received any notification of the Honduran action.

"It's a bit of a mystery to us what they are alleging," he said.

The government decision comes after thousands of local residents, led by Copan Archbishop Luis Alfonso Santos, had protested that the mining activities could pollute local waters and lead to deforestation.